Last updated: 18 May 2012
Doing business
Business opportunities
Despite poor commercial infrastructure and weaknesses in Cambodia's legal framework, opportunities exist for Australian companies.
Australian companies are well positioned to take advantage of opportunities in the following areas:
- Extraction of offshore oil and gas reserves
- Mineral extraction of bauxite and gold
- Consumables
- Dairy products
- Meat
- Beverages (wine)
Development activities financed by the World Bank, the Asian Development Bank and other donors provide opportunities for Australian firms to participate in infrastructure projects or provide professional services.
Business culture
Business tips
Many of these are shared in other parts of Asia, with Thai business practice bearing perhaps the closest resemblance.
Cambodians traditionally greet each other by pressing their palms together in front of their bodies and bowing, called a 'sompeah'. Generally a younger or lower rank person initiates the greeting. This custom has been partially replaced by the Western practice of shaking hands. It is considered acceptable for foreigners to shake hands with Cambodians of both sexes.
The head is regarded as the highest part of the body, both literally and figuratively. As a result Cambodians don’t approve of touching anyone there, even in a friendly gesture.
If possible, a business card in both English and Khmer on the reverse side should be presented during the initial greeting.
While English is becoming more widely spoken, foreigners should try to ascertain whether their partner is fluent in English and, if not, utilise an interpreter to ensure a smooth meeting and follow-up.
Cambodian businessmen can be addressed with 'Mr' and their first name, or for women, 'Madam'. Many senior managers of Cambodian companies or high level officials also have the title 'Your Excellency'.
In Cambodia, social engagements such as eating or playing golf, are useful to create a level of mutual trust and understanding between business partners. Foreign businesses who have been successful in the Cambodia have taken considerable time to build the necessary business and government contacts to operate successfully.
Face-to-face contact is very important in initial dealings with Cambodians and a capacity to understand (often) very different set of viewpoints. It is important not to become angry, abusive or frustrated with Khmers. Voicing one’s anger is unlikely to achieve much, particularly if a Khmer is forced to 'lose face' in front of his or her colleagues.
It is very important to determine at the outset in any business dealings the hierarchy and seniority of whom you are dealing with, and those responsible for decision-making. Correspondence and communications should be addressed to the senior decision-makers. Bear in mind that decisions often take a considerable length of time as they are relayed up and down the chain of hierarchy due to the lack of delegation within companies or government ministries.
Foreigners should take care to avoid a confrontational or aggressive style in their business meetings. Cambodians are generally not direct or forthright in their dealings and take to subtle, rather than blunt, messages. Cambodians will often say yes to direct questions, but this may only mean that they hear and understand you, but nothing more.
A small token of gratitude in the form of a gift is always appreciated when visiting a Cambodian. Gifts should always be offered with the right hand. If wanting to be particularly polite, foreigners should support their right elbow with the fingers of their left hand. Before entering a Cambodian home, shoes should always be removed.
While the Khmer language is not easy, Cambodians will sincerely appreciate any efforts to learn their language. Basic greetings or several words in Khmer, even if mispronounced, will act as a good icebreaker in business dealings and show that you are keen to understand an integral part of Cambodian culture.
It is considered rude to point with your feet, particularly the soles of your feet, towards a person or object, use your hand instead. Try to avoid doing so when sitting opposite anyone. Tuck your feet away under your body when sitting on the floor or on a chair.
For men, lightweight suits, including one dark suit and tie for official occasions, are appropriate as formal business attire. Light coloured suits are also acceptable. Trousers and an open-neck shirt are acceptable office wear on most occasions. For women, most styles of Western dress are acceptable in Cambodia, but very short dresses and skirts and brief tops should be avoided. Cotton is the most appropriate fabric because of the heat.
Links and resources
International Monetary Fund (Economic update) – www.imf.org/external/country/KHM/index.htm
Ministry of Commerce – www.moc.gov.kh
Ministry of Foreign Affairs and International Cooperation – www.mfaic.gov.kh
Phnom Penh Municipality – www.phnompenh.gov.kh/
Please note: this list of websites and resources is not definitive. Inclusion in this list does not imply endorsement by Austrade. The information provided is a guide only.